Comstor closes Irish office

Trade

Networking distributor Comstor has closed its Irish office but plans to keep serving Irish resellers and wants to grow its market share.

The company set up a sales arm in Dubin’s Citywest business park in early 2002 but disappointing returns led to its departure within a year of full trading. All staff at the Dublin office have been let go.‘We opened the office with the expectation of larger revenue and the opportunity was not realised,’ said Simon Minett, managing director of Comstor UK. ‘It has been a difficult year for distribution in the UK and Ireland and the team in Ireland were not performing in comparison to the UK,’ he told ComputerScope. Minett said closing the office was a ‘prudent move’, which had been dictated by the current market climate. ‘Had the economic conditions been different, I would have continued the office,’ he said.

According to Minett, Comstor remains an authorised Cisco distributor for Ireland, even though it no longer operates a local office. He confirmed Comstor’s intention to keep serving the Irish market and said he was optimistic that the level of business coming from Irish resellers would remain despite the closure. The distributor’s local phone number remains in use, albeit now routed to the UK.

Minett pointed out that all of the logistics and support functions had been delivered from the UK anyway. ‘Although we have closed the sales office, the stock, service and expertise remains in the UK. It’s the same service, just a different voice on the telephone.’

Comstor still intends to grow its market share in Ireland, Minett claimed. The distributor has some Irish-specific sales programmes in the pipeline but Minett ruled out cutting prices to try to win new business. ‘The marketplace is aggressive enough already, but there’s no point in revenue without margin. We wouldn’t want to trash the market; that’s not our stance.’

Comstor’s fate is an object lesson in the differences between the Irish and UK markets. In the latter territory, it is possible to keep a business going based on sales of a single vendor’s products. Here, in a much smaller market, that strategy is much harder to sustain. As evidence of this, the latter half of the year saw Comstor try to broaden its roster by signing deals with other networking manufacturers.

However Minett pointed out that the market for Cisco is a considerable one. ‘Cisco is so predominant that if any single vendor can make it, then it’s Cisco.’ He added that another option worth considering is that Comstor’s sister company Westcon may set up in Ireland. ‘We could choose to adopt a model of running a distributor with multi-vendor products,’ he said.

In a separate development, the storage distributor Hammer has also retrenched to the UK, closing its Dublin office which it had maintained for less than two years. According to a source within the trade, the company’s Irish strategy wasn’t well thought out. ‘Vendors on the ground here wouldn’t have been aware of them, they were just leveraging deals they had in the UK.’ Hammer was not available for comment.

10/04/2003

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